NBC, CBS clean up with 4th-qtr. scatter

Dec 17, 2001  •  Post A Comment

How the broadcast networks’ fourth-quarter scatter advertising market has turned out depends on which network you talk to.
NBC and CBS say they have had record fourth-quarter scatter volume, each exceeding $200 million in prime time-and each writing about $300 million in all dayparts.
NBC says its prime-time pricing was flat to 2 percent above upfront, when it generally lowered its prices about 10 percent. CBS says its pricing was as much as 10 percent above upfront. However, experts say more normal fourth-quarter scatter market pricing for the four broadcast networks should be up about 25 percent compared with this year’s generally flat pricing.
“We were boosted by telecommunications, retail, theatrical films and some advertisers new to network television,” said NBC Television Network President Randy Falco.
But some ad executives say only about $125 million of NBC’s take is what the network would have written on its own. The other $75 million-plus came by default from the business ABC could not write because it used so much of its fourth-quarter inventory for advertiser make-goods.
Industry experts estimate ABC made as much as $100 million in fourth-quarter advertiser make-goods after falling short of ratings guarantees. ABC declined comment.
At best, ABC sold about $40 million in fourth-quarter scatter inventory at prices that were an estimated 12 percent above the upfront, sources said. Fox, which also had a lesser make-goods problem, wrote an estimated $50 million in fourth-quarter scatter business, sources said.
“NBC could not have been as well sold as they said they were out of the upfront and still have sold more than $200 million in fourth-quarter scatter,” grumbled one ad executive. “ABC passed on business, Fox passed on business, and the other guys were sucking it up and guaranteeing it.”
However, advertising executives at the broadcast networks and agencies agreed on one thing: that there were too many extraordinary circumstances to draw any definitive conclusions about the fourth-quarter scatter market and what trends it signals for 2002.
The push back of more than $120 million in advertising time after the Sept. 11 terrorist attacks, the economic recession, widespread advertiser reticence, the delayed start of the broadcast networks’ prime-time season and baseball’s World Series are among the unusual factors that continue to skew ad spending and pricing in unpredictable ways.
But even the atypical 2001 fourth-quarter scatter performance was better than expected in volume, although flat in pricing and clearly ahead of last year’s fourth-quarter scatter market, when advertising began to tank.
However, there is disagreement among the four broadcast networks about whether this year’s fourth-quarter scatter was closer to $500 million or to $400 million.
“Everybody knew there was money sitting on the sidelines. It looks like some of this spending wasn’t really scatter market money and that it just landed up in the quarter,” one network executive said.
Said Joe Abruzzese, president of CBS network sales, “The only thing I can say about next year is that money is coming in now fairly quickly in first quarter, and options cutbacks were less than they were last year. Those are the positive signs, but it really hasn’t materialized yet.”